Home loans at 8 percent from Bank of India

Mumbai: In a move that could further intensify competition in the housing loan market, public sector lender Bank of India (BoI) has announced that it will offer home loans at eight percent for loans up to Rs. 30 lakh. With this decision, BoI has joined the bandwagon of other major lenders like State Bank of India and HDFC, who recently announced similar offers.

Under the scheme by BoI called 'Star Own Your Home,' loans above Rs. 30 lakh will be offered at 8.25 percent for the first two years. After the two years, the bank will charge interest rate based on the prevailing floating rates. The scheme is applicable for all new loans availed between January 1 and February 28, 2010, reports PTI. In an attempt to attract more home buyers, the bank has fixed the maximum amount that can be availed under this scheme at Rs. 1.5 crore, in addition to waiving off processing charges.

ICICI Bank, Kotak Mahindra Bank and IDBI Bank are some of the others lenders who have introduced similar schemes. Recently, IDBI Bank announced that it is offering loans at 8.25 percent fixed rate for all its new loans till March 2012 for all customers applying on or before March 31, 2010.